Surge in Saudi Real Estate: A Mid-Year Overview

The Saudi real estate market is experiencing a remarkable upswing, with recent data revealing significant growth in both transaction volumes and sales values. This trend is particularly evident in major cities like Riyadh and Jeddah, where the demand for residential properties is on the rise.

Transaction Growth in Major Cities

In the first half of 2025, Saudi Arabia recorded a total of 35,600 real estate transactions, marking a 10% increase compared to the same period in 2024. Jeddah, in particular, saw a substantial rise in sales values, reaching SR18.3 billion (approximately $4.9 billion), which represents a 34% year-on-year increase. The volume of transactions in Jeddah also rose by 25%, totaling 15,200 during this period.

Insights from the KSA Residential Real Estate Market Performance Report

These findings are detailed in the latest report from Cavendish Maxwell, which analyzes the residential real estate market across Riyadh and Jeddah. This report not only tracks sales prices and rental trends but also provides insights into supply levels in these cities. Cavendish Maxwell has expanded its consultancy services in Saudi Arabia, aligning with the country’s ambitious Vision 2030 initiative aimed at transforming the real estate landscape.

Factors Driving Demand

Several key factors are fueling this unprecedented demand for housing in Saudi Arabia. Population growth, large-scale projects, and upcoming global events—such as the Riyadh Expo 2030 and the FIFA World Cup 2034—are all contributing to the surge in real estate activity. The government has set an ambitious target of achieving 70% home ownership among nationals by 2030. Additionally, a new law allowing foreign investment in designated real estate zones, set to take effect in January 2026, is expected to further boost demand.

Price Trends in Riyadh and Jeddah

The report indicates that both apartment and villa sales prices have increased year-on-year in Riyadh and Jeddah. In Riyadh, apartment prices surged by 10.5%, while villa prices rose by 12.4% compared to the first half of 2024. As of June 2025, the average price for apartments stood at SR6,100 ($1,600) per square meter, while villas averaged SR5,396 ($1,439) per square meter.

In Jeddah, the growth has been steadier, with apartment prices reaching SR4,376 ($1,167), reflecting a 1.8% increase, and villa prices at SR5,114 ($1,364), up by 2.5%. Rental prices have also seen a notable rise, particularly in Riyadh, where apartment rents increased by 10.3% and villa rents by 14.4%. This growth is largely driven by an influx of families and professionals relocating to the city.

Infrastructure Developments and Future Projections

The launch of the Riyadh Metro has significantly enhanced the appeal of homes located along metro lines, further driving demand. In Jeddah, while apartment rents rose by 4.7%, villa rents experienced a slight decline of 2.7%.

Between January and June 2025, a total of 8,100 new residential units were delivered across Riyadh and Jeddah. Looking ahead, an additional 30,700 units are expected to be completed by December 2025, with a further 72,000 projected by 2027. Riyadh alone added 6,000 homes in the first half of the year, with plans for 18,000 more this year and 48,000 by 2027. The capital’s total residential inventory is anticipated to reach nearly two million units by that time.

In Jeddah, 2,100 units were delivered in the first half of 2025, with forecasts indicating 12,700 more in the second half and an additional 24,000 by 2027. The city’s inventory is expected to grow from 1.09 million units today to 1.13 million by the end of 2027.

Key Projects Shaping the Future

Several major projects are underpinning this supply growth, including Diriyah, New Murabba, and Sedra District in Riyadh, as well as Jeddah Central and Al Arous by ROSHN in Jeddah. These developments, along with various government housing initiatives, are set to reshape the residential landscape.

Sean Heckford, Director of Built Asset Consulting at Cavendish Maxwell, emphasizes that the growth of Saudi Arabia’s residential sector is indicative of a broader narrative—one that balances tradition with modernity. He notes that the ongoing policy reforms, including the new foreign property ownership law, are expected to broaden market access and stimulate housing delivery.

As Riyadh prepares to evolve into a city of over 12 million people by 2035, supported by foreign direct investment and major projects, Jeddah is positioning itself as the cultural and commercial gateway of Saudi Arabia, with ambitious waterfront and urban regeneration initiatives aimed at accommodating a population exceeding six million by 2035.